of an investigation by the Financial Markets Authority into breaches of the Crimes Act 1961, the Financial Markets Conduct Act 2013 and the Companies Act 1993

IN THE MATTER of an application by Fiona Janet Reid of the
Financial Markets Authority for an order authorising the issue of search warrants

Hearing: 19 June 2025

Appearances: B Finn and S Lowery for Applicant
R Mansfield K C and S L Cogan for the Clarkes R Reed KC for Mr A
J Dixon KC and H Lanham for Mr B (written submissions only)

Judgment: 21 July 2025

JUDGMENT OF ANDERSON J

This judgment was delivered by me on 21 July 2025 at 4.15 pm pursuant to r 11.5 of the High Court Rules 2016.

………………………………
Registrar/Deputy Registrar

Solicitors: Luke Cunningham Clere, Auckland

Re FINANCIAL MARKETS AUTHORITY APPLICATION [2025] NZHC 2010 [21 July 2025]

Introduction

[1] The Financial Markets Authority (FMA) is investigating the Du Val Group, controlled by John Kenyon and Charlotte Clarke, for potential breaches of “financial markets legislation” as defined in the Financial Markets Authority Act 2011 (FMAA).1 The investigation involves former Du Val personnel — Mr and Mrs Clarke, Mr A, and Mr B.2

[2] This decision concerns the FMA’s “on-notice” application for five search warrants (the New Warrants) under s 29 of the FMAA.

[3] The application is novel. The FMA has already seized the relevant material under warrants executed in 2024 (the Initial Warrants). These already authorise the searches the FMA wants to undertake. The FMA does not seek the New Warrants because an extension of its current search powers is required. Rather, it applies to the Court for New Warrants because it accepts that legitimate questions arise as to the lawfulness of the Initial Warrants under which it seized the material.3

[4] The respondents oppose the application, arguing there is no jurisdiction to issue the New Warrants, or that doing so would be improper or an abuse of process.4 They do not currently contest the evidential sufficiency for the New Warrants but reserve their position on that issue.

Procedural background

[5] In February 2024 and August 2024, the District Court issued search warrants to search a solid-state drive (SSD) for documents related to Du Val. The February warrant related to the FMA’s investigation into an investment known as the Build to Rent Fund. The FMA undertook searches to identify potentially relevant documents and has reviewed the responsive documents.

1 Under s 4(1), “financial markets legislation” is defined broadly by reference to legislation listed in sch 1. In addition to the Financial Markets Conduct Act 2013, this includes the Companies Act 1993, and certain offences under the Crimes Act 1961.
2 I granted suppression of the names and identifying particulars of these…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Financial Markets Authority application

Details

AGLC: Financial Markets Authority application [2025] NZHC 2010
Case: [2025] NZHC 2010
Decision Date: 21 July 2025

CaseChat Overview and Summary

The Financial Markets Authority (FMA) sought to issue five search warrants (the New Warrants) to search material it had already seized under prior warrants (the Initial Warrants) in an investigation into the Du Val Group, controlled by John Kenyon and Charlotte Clarke. The investigation involved former Du Val personnel: Mr and Mrs Clarke, Mr A, and Mr B. The respondents opposed the application on the basis that there is no jurisdiction to issue the New Warrants, or that doing so would be improper or an abuse of process. The FMA's application was based on the R v Pikia decision, in which the Court of Appeal found various warrants issued to the Serious Fraud Office were invalid because they were “overbroad” and akin to general warrants. The FMA argues it seeks to ensure that any searches it now intends to carry out on the previously seized material are lawful, due to doubts raised by the breadth of the warrants found to be invalid in R v Pikia. The respondents reject the FMA’s characterisation of the R v Pikia decision as an intervening development, arguing the need for specificity is well-established by previous case law. The Court held that the New Warrants are not contemplated by the statutory framework and that the FMA has already obtained the power to search the material it now holds. The Court further held that issuing the New Warrants would be contrary to the purposes of the Search and Surveillance Act 2012 and the principle of recognising the importance of rights and entitlements affirmed in the New Zealand Bill of Rights Act 1990 and the Privacy Act 2020. The Court also held that the New Warrants are redundant if the Initial Warrants are valid, and that issuing a new warrant over material already held under an executed warrant would be oppressive if the initial warrants are invalid. The Court dismissed the FMA’s application for search warrants.

Orders